Marhaba Feature: The Riyal Story

When you last dipped your hand in your pocket and drew out a Qatari Riyal note or a coin, how much attention did you pay to it? Perhaps you gave a cursory glance to check that it was the right denomination. But if it was taken away from you, could you describe it? Do you know all the denominations of notes and coins in circulation, and what do you know about the history of the currency in Qatar?

Money has been around for a long time. The Chinese invented coinage in the second millennium BC as a common medium of exchange which would be acceptable in payment for goods and services or to settle debts. Then around 800 AD, they supplemented coins with paper notes. Of course, especially minted coins or printed notes have never been the only form of currencies – some societies used shells, particularly the beautiful cowrie shells, and the Romans used salt to pay their soldiers’ wages – a practice which gave us the word salary.

Cowrie Shells

Legal Tenders

If you go back half a century or so in Qatar, the legal tender was the Indian Rupee. However, in 1966 along with speculation that India was about to devalue its currency was the concern that the move could adversely affect the Qatari and Gulf economy.

Neither Qatar nor Dubai had achieved their independence at that stage and at first, a decision was taken to issue Qatar and Dubai riyals. Whilst the logistics of design, printing and minting were dealt with, the cooperation of the Saudi Arabian authorities was sought. So when the Indian Rupee was withdrawn from circulation in Qatar on 16 June 1966. It was in fact replaced for three months by the Saudi Riyal. The new Qatar and Dubai Riyal was subsequently introduced on 18 September 1966 in denominations of one, five, ten, twenty-five, fifty, one hundred and five hundred Riyal notes and coins of one, five, ten, twenty-five and fifty Dirhams.

Seven years later the government of Qatar decided to have its own separate currency and on 19 May 1973, the first issue of Qatari Riyals was introduced. The denominations were the same however with only the withdrawal of the twenty-five riyal note, and they remain the same today.

The second issue of notes was put into circulation on 5 May 1981 at which time the width of the notes was slightly increased, and the colours of the denominations changed. The one riyal note was changed from red instead of purplish brown. But from day one, the green of the ten-riyal note the blue of the fifty and the green of the one-hundred riyal note remained the same.

Old one-riyal note. Image courtesy of Qatar Central Bank.

The third issue was introduced on 22 July 1996, giving Qatar central bank the opportunity to make some minor alterations to the notes. By then, the Qatar Monetary Agency had been replaced by Qatar Central Bank, so the new notes bore that legend, along with the signatures of then Minister of Finance Economy and Trade, and the governor of the central bank. The Ministry of Finance Economy and Trade is now known as Ministry of Finance.

A number of new security features were also incorporated, including a hologram on the blue five hundred riyal notes. There was also the introduction of both vertical and horizontal serial numbers on the notes, watermarks in all the notes, and security threads passing through the notes of larger denomination.

The whole aspect of security has taken on added importance in an age when forgers become more and more sophisticated, and state-of-the-art technology has enabled them to employ similar techniques to the printers of genuine currency. That’s why around the world such things as holograms are used – or special infrared or ultra-violet inks which make part of the pattern of the notes disappear under specific lighting conditions.

Any review of the design of Qatar’s notes is by a committee which tries to ensure that the overall design concept incorporates both the country’s heritage and its modern development. The committee also studies such suggestions as that for the replacement of the one riyal note by a coin. Coins can, obviously, be expected to remain in circulation for a longer time; on average one and five riyal notes remain in circulation for two years; the ten-riyal notes circulate for an average of three years and the higher denominations for five years.

Qatar central bank always ensures that enough notes have been printed for it to cover circulation for a period of five years, but the demand for notes has increased dramatically over recent years. There are also certain times of year when there is a ‘run’ on new notes. During each Eid holiday, it is traditional for children to given money by friends and neighbours, always in the form of notes in mint condition.

On the subject of coins

Image courtesy of Coins & Banknotes

Whilst you commonly see fifty and twenty-five dirham coins in circulation, you seldom find the lower denominations! The ten, five and one Dirham coins were last minted in the 1970s, but occasionally are still demanded by schools for their maths classes and they are occasionally required by banks and exchange houses for exchange transactions!

What happens to all the old notes? Well, the auditors, together with representatives of the Emiri Diwan – supervise the destruction of all those damaged and defaced notes withdrawn from circulation, by shredding and burning. It is an operation that was originally carried out just once a year – but since the volume of notes in circulation is now so great, the mammoth security operation has to be mounted twice every twelve months.

So next time you handle cash, don’t just spend it, have a good look at the designs of the notes and coins and think about the history of the currency, a lot of time and money has gone into its development.